[Federal Register: January 14, 1998 (Volume 63, Number 9)]
[Rules and Regulations]
[Page 2142-2146]
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LIBRARY OF CONGRESS
Copyright Office
37 CFR Part 253
[Docket No. 96-6 CARP NCBRA]
Noncommercial Educational Broadcasting Compulsory License
AGENCY: Copyright Office, Library of Congress.
[[Page 2143]]
ACTION: Final rule.
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SUMMARY: The Copyright Office of the Library of Congress is announcing
the adoption of final rules governing the terms and rates of copyright
royalty payments with respect to certain uses by public broadcasting
entities of published nondramatic musical works, and published
pictorial, graphic, and sculptural works.
EFFECTIVE DATE: January 1, 1998.
FOR FURTHER INFORMATION CONTACT: David O. Carson, General Counsel, or
Tanya M. Sandros, Attorney Advisor, Copyright Arbitration Royalty Panel
(CARP), P.O. Box 70977, Southwest Station, Washington, D.C. 20024.
Telephone (202) 707-8380. Telefax: (202) 707-8366.
SUPPLEMENTARY INFORMATION:
I. Background
Section 118 of the Copyright Act, 17 U.S.C., creates a compulsory
license for the use of published nondramatic musical works and
published pictorial, graphic, and sculptural works in connection with
noncommercial broadcasting. Terms and rates for this compulsory
license, applicable to parties who are not subject to privately
negotiated licenses, are published in 37 CFR part 253 and are subject
to adjustment at five year intervals. 17 U.S.C. 118(c). The last
adjustment of the terms and rates for the section 118 license occurred
in 1992, making 1997 a window year for the adjustment of these terms
and rates. 57 FR 60954 (December 22, 1992).
Section 118(b) provides that any copyright owner and any public
broadcasting entity may negotiate the rates and terms for the
compulsory license, or in the absence of a negotiated license,
the Librarian of Congress shall, pursuant to Chapter 8, convene a
copyright arbitration royalty panel to determine and publish in the
Federal Register a schedule of rates and terms which, subject to
paragraph (2), shall be binding on all owners of copyright in works
specified by this subsection and public broadcasting entities,
regardless of whether such copyright owners have submitted proposals
to the Librarian of Congress * * *
Interested parties who submit proposals for adjusting the terms and
rates for the section 118 license directly to the Librarian of Congress
may petition the Librarian to submit these proposals to a public notice
and comment proceeding, whereby copyright owners and users that would
be affected by the proposals are given the opportunity to challenge
them. 37 CFR 251.63. Any party who objects to the proposed terms and
rates must submit, in turn, their challenges by a date certain, and
must be willing to participate in the Copyright Arbitration Royalty
Panel (CARP) proceeding adjusting the section 118 terms and rates. If
no challenges are received, or if challenges are received by an
interested party who will not participate in a CARP proceeding, the
Librarian may adopt the terms and rates of the proposals.
Accordingly, interested copyright owners and users of these works
may file either a voluntary agreement or a joint proposal outlining the
adjustments to the terms and rates for the section 118 license; or in
the case of unaffiliated copyright owners,<SUP>1</SUP> the users may
submit their proposals for the adjustment of the terms and rates of the
section 118 license directly to the Librarian of Congress. See 62 FR
51619 (October 2, 1997) and 62 FR 63502 (December 1, 1997). A joint
proposal differs significantly from a voluntary settlement. The parties
to a voluntary agreement represent all persons who would be affected by
the agreement and the parties have the authority to bind their members.
In a joint proposal, the parties to the agreement do not represent all
persons who would be affected by the agreement, or if they do, at least
one of the parties does not have the authority to bind its members.
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\1\ An unaffiliated copyright owner is one whose interests are
not represented by a performing rights society, or by any other
organization participating in the proceeding.
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II. This Proceeding
The Office commenced the process for adjusting the section 118
rates and terms with the publication of a Federal Register notice
announcing a negotiation period during which interested parties could
negotiate voluntary license agreements that are ``given effect in lieu
of any determination by the Librarian of Congress: Provided, That
copies of such agreements are filed in the Copyright Office within
thirty days of execution.'' 17 U.S.C. 118(b)(2). The notice also
requested comment on the need for a CARP to set the rates and terms, in
addition to setting a precontroversy discovery schedule and an
initiation date for the CARP. 61 FR 54459 (October 18, 1996).
On November 11, 1996, the National Public Radio, the Public
Broadcasting Service, the American Society of Composers, Authors and
Publishers (ASCAP), Broadcast Music, Inc. (BMI), SESAC, Inc., the
National Music Publishers Association, Inc. (NMPA), and the Harry Fox
Agency, Inc. filed notices of intent to participate. On June 19, 1997,
the National Religious Broadcasters Music License Committee requested
leave to file its notice of intent to participate after the deadline
for making this filing had passed. The Register granted its motion and
accepted the filing. Order in Docket No. 96-6 CARP NCBRA (July 30,
1997). Two additional parties, The American Council on Education and
The National Federation of Community Broadcasters, did not file notices
of intent to participate, although they participated in the
negotiations of certain rates and terms of interest to their members.
Upon the request of the parties, the Office vacated the schedule
set in the October 18, 1996, order in order to allow the parties more
time to negotiate the rates and terms for the section 118 compulsory
license. In July 1997, however, the parties informed the Office that
the negotiations had been unproductive and identified the need to
convene a CARP to set reasonable terms and rates. At this time, the
Office set a new schedule for the 45-day precontroversy discovery
period, including a date for submitting proposals for the payment of
royalties to unaffiliated copyright owners and a date for initiating
the CARP. Order in Docket No. 96-6 CARP NCBRA (July 30, 1997).
In accordance with the new schedule, the National Religious
Broadcasters Music License Committee (NRBMLC), the Public Broadcasting
Service, and the National Public Radio filed proposed rates and terms
for the payment of royalty fees to unaffiliated copyright owners on
September 2, 1997. Subsequently, on October 1, 1997, the parties filed
additional joint proposals for further adjusting the rates and terms of
the section 118 compulsory license and notices of settlement. The only
terms and rates not addressed in proposed regulations or a joint
settlement concern the terms and rates relating to the performance of
musical compositions in the repertories of ASCAP and BMI by PBS and
NPR. <SUP>2</SUP>
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\2\ The Office shall convene a CARP to determine the appropriate
rates and terms in this instance. See Order in Docket No. 96-4 CARP
NCBRA (July 30, 1997). Currently, these parties are engaged in
precontroversy discovery.
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The Office has published all the proposed rates and terms in the
Federal Register for public review and comment, pursuant to 37 CFR
251.63. 62 FR 51619 (October 2, 1997) and 62 FR 63502 (December 1,
1997). The December 1, 1997, notice announced that the proposed
regulations would become final on January 1, 1998, unless an interested
party filed a challenge to
[[Page 2144]]
the proposed regulations and a Notice of Intent to Participate in a
CARP proceeding, on or before December 29, 1997. 62 FR 63502 (December
1, 1997). See also 62 FR 65777 (December 16, 1997) (correction notice
clarifying the filing dates).
The proposed regulations, however, did not include the 1998 rates
for the use of published nondramatic musical compositions in the
repertories of ASCAP and BMI by public broadcasting entities licensed
to colleges, universities and other nonprofit educational institutions
not affiliated with National Public Radio. In their direct cases, ASCAP
and BMI proposed that the 1998 rate should be the current rate adjusted
for a cost of living increase, according to the methodology adopted by
the former Copyright Royalty Tribunal in the 1987 rate adjustment
proceeding. 52 FR 49010 (December 29, 1987). The Office stated in the
December 1, 1997, notice that it would publish these rates in the final
regulations.
The Copyright Office has received no comments or Notices of Intent
to Participate in a CARP proceeding in response to its notices
announcing the proposed regulations for adjusting certain rates and
terms of the noncommercial educational broadcasting compulsory license.
Therefore, the Office announces the adoption of the proposed
regulations published on December 1, 1997, as final regulations,
including the rate for the performance of musical compositions in the
ASCAP and BMI repertories by public broadcasting entities licensed to
colleges and universities.
The Office has calculated these rates based on a 2.1% change in the
Consumer Price Index (CPI), during the period between the first CPI
subsequent to December 1, 1996, and the last CPI published prior to the
December 1, 1997. (1996's figure was 158.3; 1997's figure was 161.6,
based on 1982-1984 equaling 100). Rounding off to the nearest dollar,
the adjustment in the royalty rate for the use of musical compositions
in the repertory of ASCAP and BMI is $222. The rate for the use of
musical works in the SESAC repertory, which in subsequent years will be
adjusted in a like manner, was set at $60 in the joint proposal
submitted by SESAC and the American Council on Education and included
in the proposed regulations at 37 CFR 253.5(c)(3).
Regulatory Flexibility Act
Consistent with the requirements of the Regulatory Flexibility Act,
the Copyright Office has considered the effect of this final regulation
on small businesses and has determined that it will have no significant
impact. The Copyright Act creates a compulsory license for the use of
published nondramatic musical works and published pictorial, graphic,
and sculptural works in connection with noncommercial broadcasting. The
purpose of such compulsory license is to allow any business small or
large to make use of the compulsory license instead of privately
negotiating rates and terms. Reliance on the compulsory license saves
time, effort, and expense.
The rates and terms of such compulsory license are subject to
adjustment at five year intervals. The last setting of terms and rates
was published in the Federal Register in 1992. The Office initiated the
process for adjusting rates and terms on October 18, 1996, by
announcing a negotiation period. The law requires the Office to convene
a Copyright Arbitration Royalty Panel (CARP) if the parties do not
agree upon the rates and terms. The Office vacated the original
schedule in order to allow the parties more time to negotiate the rates
and terms for the section 118 compulsory license. All announcements
that affected the parties were published both in the Federal Register
and online (http://lcwebs.loc.gov/copyright). At the conclusion of the
negotiation period, the rates and terms were agreed upon by the parties
except in one area which does not affect any small business. The
businesses which did not reach agreement are all dominant in their
field of operation.
List of Subjects in 37 CFR Part 253
Copyright, Music, Radio, Television.
Final Regulations
For the reasons set forth in the preamble, the Library amends 37
CFR part 253 as follows:
PART 253--USE OF CERTAIN COPYRIGHTED WORKS IN CONNECTION WITH
NONCOMMERCIAL EDUCATIONAL BROADCASTING
1. The authority citation for part 253 continues to read as
follows:
Authority: 17 U.S.C. 118, 801(b)(1) and 803.
Sec. 253.1 [Amended]
2. The first sentence of Sec. 253.1 is amended to remove the year
dates ``1993'' and ``1997'' and to add in their place ``1998'' and
``2002'', respectively.
3. Section 253.4 is amended by revising the introductory text,
paragraphs (a)(1) through (8), and the last sentence of paragraph (c)
to read as follows:
Sec. 253.4 Performance of musical compositions by PBS, NPR and other
public broadcasting entities engaged in the activities set forth in 17
U.S.C. 118(d).
The following schedule of rates and terms shall apply to the
performance by PBS, NPR and other public broadcasting entities engaged
in activities set forth in 17 U.S.C. 118(d) of copyrighted published
nondramatic musical compositions, except for public broadcasting
entities covered by Secs. 253.5 and 253.6, and except for compositions
which are the subject of voluntary license agreements, or compositions
in the repertories of ASCAP, BMI or SESAC which are licensed on terms
and conditions established by a duly empowered Copyright Arbitration
Royalty Panel pursuant to the procedures set forth in subchapter B of
37 CFR, part 251.
(a) Determination of royalty rates. (1) For the performance of such
a work in a feature presentation of PBS:
1998-2002.................................................. $211.53
(2) For the performance of such a work as background or theme music
in a PBS program:
1998-2002.................................................. $53.59
(3) For the performance of such a work in a feature presentation of
a station of PBS:
1998-2002.................................................. $18.08
(4) For the performance of such a work as background or theme music
in a program of a station of PBS:
1998-2002.................................................. $3.81
(5) For the performance of such a work in a feature presentation of
NPR:
1998-2002.................................................. $21.44
(6) For the performance of such a work as background or theme music
in an NPR program:
1998-2002.................................................. $5.20
(7) For the performance of such a work in a feature presentation of
a station of NPR:
1998-2002.................................................. $1.52
(8) For the performance of such work as background or theme music
in a program of a station of NPR:
1998-2002.................................................. $.54
* * * * *
(c) * * * Any local PBS and NPR station that shall be required by
the provisions of any voluntary license agreement with ASCAP or BMI
covering
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the license period January 1, 1998, to December 31, 2002, to prepare a
music use report shall, upon request of a copyright owner who believes
a musical composition of such owner has been performed under the terms
of this schedule, permit such copyright owner to examine the report.
* * * * *
4. In Sec. 253.5, paragraphs (c) (1) through (3) are revised to
read as follows:
Sec. 253.5 Performance of musical compositions by public broadcasting
entities licensed to colleges and universities.
* * * * *
(c) * * *
(1) For all such compositions in the repertory of ASCAP, $222
annually.
(2) For all such compositions in the repertory of BMI, $222
annually.
(3) For all such compositions in the repertory of SESAC, $60
annually.
* * * * *
5. In Sec. 253.6, paragraph (c) is revised to read as follows:
Sec. 253.6 Performance of musical compositions by other public
broadcasting entities.
* * * * *
(c) Royalty rate. A public broadcasting entity within the scope of
this section may perform published nondramatic musical compositions
subject to the following schedule of royalty rates:
(1) For all such compositions in the repertory of ASCAP, in 1998,
$375; in 1999, $390; in 2000, $405; in 2001, $420; in 2002, $440.
(2) For all such compositions in the repertory of BMI, in 1998,
$375; in 1999, $390; in 2000, $405; in 2001, $420; in 2002, $440.
(3) For all such compositions in the repertory of SESAC, in 1998,
$78; in 1999, $82; in 2000, $86; in 2001, $89; in 2002, $92.
(4) For the performance of any other such compositions, in 1998
through 2002, $1.
* * * * *
6. Section 253.7 is amended by revising paragraph (a); revising the
schedules in paragraphs (b)(1) (i) and (ii), (b)(2) and (b)(4); and
revising the last sentence of paragraph (b)(5) to read as follows:
Sec. 253.7 Recording Rights, Rates and Terms.
(a) Scope. This section establishes rates and terms for the
recording of nondramatic performances and displays of musical works,
other than compositions subject to voluntary license agreements, or
compositions represented by the Harry Fox Agency, Inc., SESAC, and/or
the National Music Publishers Association and which are licensed on
terms and conditions established by a duly empowered Copyright
Arbitration Royalty Panel pursuant to the procedures set forth in this
subchapter, on and for the radio and television programs of public
broadcasting entities, whether or not in synchronization or timed
relationship with the visual or aural content, and for the making,
reproduction, and distribution of copies and phonorecords of public
broadcasting programs containing such nondramatic performances and
displays of musical works solely for the purpose of transmission by
public broadcasting entities. The rates and terms established in this
schedule include the making of the reproductions described in 17 U.S.C.
118(d)(3).
(b) * * *
(1) * * *
(i) * * *
1998-2002
Feature.................................................... $106.04
Concert feature (per minute)............................... 31.84
Background................................................. 53.59
Theme:
Single program or first series program................... 53.59
Other series program..................................... 21.75
(ii) * * *
1998-2002
Feature.................................................... $8.76
Concert feature (per minute)............................... 2.30
Background................................................. 3.81
Theme:
Single program or first series program................... 3.81
Other series program..................................... 1.52
* * * * *
(2) * * *
1998-2002
Feature.................................................... $11.48
Concert feature (per half hour)............................ 16.85
Background................................................. 5.75
Theme:
Single program or first series program................... 5.75
Other series program..................................... 2.29
* * * * *
(4) * * *
1998-2002
Feature.................................................... $.74
Feature (concert)(per half hour)........................... 1.54
Background................................................. .37
(5) * * * Such succeeding uses which are subsequent to December 31,
2002, shall be subject to the royalty rates established in this
schedule.
* * * * *
7. In Sec. 253.8, paragraph (b)(1) and the last sentence of
paragraph (f)(1) are revised as follows ( the undesignated paragraph
following paragraph (b)(1) is unchanged):
Sec. 253.8 Terms and rates of royalty payments for the use of
published pictorial, graphic and sculptural works.
* * * * *
(b) Royalty rate. (1) The following schedule of rates shall apply
to the use of works within the scope of this section:
(i) For such uses in a PBS-distributed program:
(A) For a featured display of a work.
1998-2002.................................................. $64.78]
(B) For background and montage display.
1998-2002.................................................. $31.59
(C) For use of a work for program identification or for thematic
use.
1998-2002.................................................. $127.71
(D) For the display of an art reproduction copyrighted separately
from the work of fine art from which the work was reproduced,
irrespective of whether the reproduced work of fine art is copyrighted
so as to be subject also to payment of a display fee under the terms of
the schedule.
1998-2002.................................................. $41.95
(ii) For such uses in other than PBS-distributed programs:
(A) For featured display of a work.
1998-2002.................................................. $41.95
(B) For background and montage display.
1998-2002.................................................. $21.51
(C) For use of a work for program identification or for thematic
use.
1998-2002.................................................. $85.76
(D) For the display of an art reproduction copyrighted separately
from the work of fine art from which the work was reproduced,
irrespective of whether the semin reproduced work of fine art is
copyrighted so as to be subject also to payment of a display fee under
the terms of this schedule.
1998-2002.................................................. $21.51
* * * * *
(f) Terms of use. (1) * * * Such succeeding uses which are
subsequent to December 31, 2002, shall be subject to the rates
established in this schedule.
* * * * *
8. In Sec. 253.10, the first sentence of paragraph (a) is revised
to read as follows:
Sec. 253.10 Cost of living adjustment.
(a) On December 1, 1998, the Librarian of Congress shall publish in
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the Federal Register a notice of the change in the cost of living as
determined by the Consumer Price Index (all consumers, all items)
during the period from the most recent Index published prior to
December 1, 1997, to the most recent Index published prior to December
1, 1998.
* * * * *
Dated: January 6, 1998.
David O. Carson,
General Counsel.
Approved by.
James H. Billington,
The Librarian of Congress.
[FR Doc. 98-819 Filed 1-13-98; 8:45 am]
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